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bonnie-sc-techse
May 27, 2021
Question

I need to know whether I should be reporting our purchases as COGS or just as an expense.

  • May 27, 2021
  • 1 reply
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When we purchase items to sell to our customers, we purchase as needed. We do not keep any stock on hand. So when we make a purchase I categorize it just as an expense. Should this be COGS or just expense?

1 reply

Rustler
Rustler
May 27, 2021

When you file taxes, COGS is related to the cost of the items in inventory that you sold.

 

Ideally I would set up a new COGS type account called COS, cost of sales, in the chart of accounts.  use that account for anything you buy for the customer

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